Published on August 1st, 2020 | by Daniel Sherman Fernandez0
FCA Posts Huge USD1.23 Billion Losses
Not to worry they have enough available funds to come back healthy.
Fiat Chrysler Automobiles (FCA) has just posted a smaller-than-expected operating loss in the second quarter, as a small profit in North America helped to limit its losses brought about by the COVID-19 pandemic.
Having just weeks ago announced the new joint venture name of Stellantis, this Italian-American automotive conglomerate is showing no signs of slowing down as they sit in the 4th position of car manufacturers globally.
PRESS RELEASE: FCA FCHA.MI, FCAU.N said on Friday it made an adjusted loss before interest and tax of 928 million euros (USD1.10 billion) in April-June, versus a forecast 1.87-billion-euro loss in an analyst poll compiled by Reuters.
The group also said it made adjusted earnings before interest and tax of 39 million euros in North America, the home market of its Jeep and Ram brands, in the quarter.
Milan-listed FCA shares were up 1.2 per cent at 1125 GMT, after being little changed before the results.
Chief Executive Mike Manley said the group’s plants were up and running and car dealers were selling in showrooms and online, following disruptions caused by the pandemic.
“We have the flexibility and financial strength to push ahead with our plans,” he said in a statement.
“Our second quarter showed that decisive actions and extraordinary contributions from our workforce enabled FCA to contain the impact of the COVID-19 crisis,” continued CEO Mike Manley.
“Our factories are up and running, dealers are selling in showrooms and online and we have the flexibility and financial strength to push ahead with our plans,” he said.
Revenue at FCA, whose brands include Fiat, Chrysler, Jeep, Maserati, Alfa Romeo, Dodge and Ram, plunged 56 per cent to 11.7 billion euros, less than the 14 billion euros that analysts earlier predicted.
From April to June, FCA shipped 424,000 vehicles worldwide, down 63 per cent from the same period last year.
FCA is due to merge with France’s PSA and the company said on Friday that “the COVID-19 crisis has further underlined the compelling logic” of the merger.
“Work by both teams towards the completion of the merger has continued apace and we expect to meet the objective of combining as a single company by the end of the first quarter 2021,” FCA said.
FCA, which is set to tie-up with Peugeot maker PSA PEUP.PA to create Stellantis, the world’s fourth largest carmaker, said on ongoing probe launched by European Commission competition authorities was not expected to delay the merger timetable.
Despite the pandemic, PSA earlier this week delivered a profit in the first half of the year and stuck to its medium-term margin goal.
FCA said its industrial free cash flow was minus 4.9 billion euros in the second quarter, with a slightly lower cash burn compared with January-March.